KULDEEP KAUR,VILL-DESHU MAJRA, MOHALI V. INCOME TAX OFFICER, MOHALI

ITA 5/CHANDI/2024

AI Insights

This case involves an appeal by the Assessee, Kuldeep Kaur, against the order of the Ld. CIT(A)/NFAC, Delhi, which confirmed the additions made by the Ld. Assessing Officer regarding unexplained cash deposits and credit entries in the Assessee's bank account for the Assessment Year 2011-12. The Assessing Officer had added Rs. 35,00,000 as unexplained cash deposit and Rs. 50,15,000 as unexplained credit entries, treating them as income from undisclosed sources. The Assessee did not respond to multiple notices, leading to an ex parte assessment. The CIT(A) upheld the AO's decision, leading to this appeal. The ITAT found procedural lapses in the handling of the Assessee's case and remanded the matter back to the AO for a fresh assessment.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 107652 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Other Referred Cases: CIT Vs. Multiplan India Limited, Estate of Late Tukhoji Rao Holkar Vs. CWT
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIVEK VARDHAN
• Keywords: Income from undisclosed sources; Principle of natural justice
• Section: 147; 148; 144; 142(1); 271(1)(c)

Judgement Text

"आयकर अपीलीय अिधकरण,चǷीगढ़ Ɋायपीठ “ए” , चǷीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH HEARING THROUGH: VIRTUAL MODE ŵी लिलत क ुमार, Ɋाियक सद˟ एवं ŵी क ृणवȶ सहाय, लेखा सद˟ BEFORE: SHRI. LALIET KUMAR, JM & SHRI. KRINWANT SAHAY, AM आयकर अपील सं./ ITA No. 5 /Chd/ 2024 िनधाŊरण वषŊ / Assessment Year : 2011-12 Kuldeep Kaur, H.No. 46, Ward-3 Village Deshu Majra, P.O Kharar, Mohali- 140301 बनाम The ITO Mohali ˕ायी लेखा सं./PAN NO: CDCPK1020P अपीलाथŎ/Appellant ŮȑथŎ/Respondent िनधाŊįरती की ओर से/Assessee by : None राजˢ की ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT सुनवाई की तारीख/Date of Hearing : 18/03/2025 उदघोषणा की तारीख/Date of Pronouncement : 07/04/2025 आदेश/Order PER LALIET KUMAR, J.M: This is an appeal filed by the Assessee against the order of the Ld. CIT(A)/NFAC, Delhi dt. 27/10/2023 pertaining to Assessment Year 2011-12. 2. In the present appeal Assessee has raised the following grounds: The Ld. Assessing Officer wrongly added and the Ld. Commissioner of Income Tax (Appeals) wrongly confirmed an amount of Rs.35,00,000/- in cash In the income of the appellant. It may kindly be deleted. The Ld. Assessing Officer wrongly added and the Ld. Commissioner of Income Tax (Appeals) wrongly confirmed an amount of Rs. 50,15,000/ credit entries only on the basis of wrong information. The Source of the Cash and credit entry are the sale of land. It may kindly be deleted. Any other ground of appeal which may be taken before the hearing of Appeal with the permission of the Honourable Income Tax Appellate Tribunal, Chandigarh. 3. Briefly the facts of the case are that the assessee deposited the cash amounting to Rs. 35,00,000/- in her bank account (No. 0254-FHO0002-001) 2 maintained with IndusInd Bank, Kharar Branch, during the Financial Year (F.Y.) 2010-11, relevant to the Assessment Year (A.Y.) 2011-12. Since the assessee failed to file her income return for the year under consideration, proceedings under Section 147 of the Income Tax Act, 1961, were initiated by the then Income Tax Officer, Ward 6(4), Mohali, with prior approval from the Principal CIT- 2, Chandigarh. The reassessment was started after recording reasons for reopening of the case, and a notice under Section 148 of the Income Tax Act, 1961, was issued on 28.03.2018. 3.1 In response to the notice dated 28.03.2018 issued under Section 148, the assessee did not file her income tax return for A.Y. 2011-12. Consequently, subsequent notices under Section 142(1) of the Act, dated 20.07.2018 and 08.10.2018, were issued, requiring compliance by 31.07.2018 and 16.10.2018, respectively. The assessee failed to respond to these notices. To adhere to the principles of natural justice, an additional notice under Section 142(1), dated 18.10.2018, along with a show-cause notice, was served, scheduling a hearing for 26.10.2018. The assessee did not respond to this notice either. Due to non-compliance on the part of the assessee, the AO conclude the assessment proceedings ex parte under Section 144 of the Act, based on material available on records. and best judgment. 3.2 A review of the bank statement (Account No. 0254-FHO0002-001) reveals cash deposits of Rs. 35,00,000/- and credit entries totaling Rs. 50,15,000/- during F.Y. 2010-11 (A.Y. 2011-12). Through the show-cause notice dated 18.10.2018, the assessee was directed to explain the sources of these deposits and credit entries. Despite multiple opportunities, no explanation, reply, or documentary evidence was submitted.In the absence of any substantiation, the aggregate amount of ₹85,15,000/- is treated as the assessee’s income from undisclosed sources under the head \"Income from Other Sources.\" Further, as the assessee concealed particulars of income accruing during F.Y. 2010-11 (A.Y. 2011- 3 12), penalty proceedings under Section 271(1)(c) of the Act for concealment of income are hereby initiated separately. 3.3 Additionally, the bank statement reflects accrued interest income of Rs. 44,032/- during F.Y. 2010-11. Since no income return was filed, this interest income of Rs. 44,032/- is charged to tax under \"Income from Other Sources.\" 4. Against the order of the Ld. AO the assessee went in appeal before the Ld. CIT(A) who has since dismissed the appeal of the Assessee. 5. Against the order of the Ld. CIT(A) the assessee came up in appeal before us. 6. During the course of hearing none appeared on behalf of the Assessee. 7. Per contra, the Ld. DR relied on the order of the Ld. CIT(A) wherein it was stated that appellant is not desirous of pursuing the grounds of appeal though more than adequate opportunities were provided. Since the appellant failed to controvert the AO’s findings in making addition of cash deposit of Rs. 35,00,000/- and credit entries of Rs. 50,15,000/- during F.Y. 2010-11 in her bank account no. 0254 FH00002-001 maintained with the Indusind Bank, Kharar Branch as unexplained money and interest income of Rs. 44,082/- from the said bank account, therefore, I have no other alternative but to upheld the order passed by the AO and dismiss the appeal following the ratio of the decision of the Hon’ble ITAT, Delhi Bench in the case of CIT Vs. Multiplan India Limited reported in 38 ITD 320 and also the decision of the Hon’ble MP High Court in the case of Estate of Late Tukhoji Rao Holkar Vs. CWT reported in 233 ITR 480. 8. We have heard the Ld. DR and perused the material available on the record. In the present case we find that the Ld. CIT(A) passed the impugned order without considering the facts submitted by the assessee that the AO has send notices to wrong addresses instead of her actual address and without giving an opportunity of hearing to the assessee which is bad in law. We deem it 4 appropriate to remand the matter back to the file of Ld. AO with a direction to pass the order after considering the submission of the assessee. Needless to say the above said exercise shall be carried out by the Ld. AO after affording an opportunity of hearing to the assessee and following the principles of natural justice. 9. In the result, appeal of the Assessee is allowed for statistical purposes. Order pronounced in the open Court on 07/04/2025. Sd/- Sd/- क ृणवȶ सहाय लिलत क ुमार (KRINWANT SAHAY) (LALIET KUMAR) लेखा सद˟/ ACCOUNTANT MEMBER Ɋाियक सद˟ /JUDICIAL MEMBER AG आदेश की Ůितिलिप अŤेिषत/ Copy of the order forwarded to : 1. अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent 3. आयकर आयुƅ/ CIT 4. आयकर आयुƅ (अपील)/ The CIT(A) 5. िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, चǷीगढ़/ DR, ITAT, CHANDIGARH 6. गाडŊ फाईल/ Guard File आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar "